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When CryptoKitties, one of the very first non-fungible token (NFT) projects, brought the Ethereum blockchain to a halt in late 2017 due to immense congestion, developer Dapper Labs learned firsthand that current-gen blockchains weren’t built to handle such demand.
With NFTs—provably-unique tokens that can be linked to digital content—becoming increasingly popular, something needed to be done.
Rather than simply find another home for its decentralized app (dapp) or wait for Ethereum scaling solutions to mature, Dapper decided to build the kind of blockchain that it and other developers could rely on.
The result is Flow, a blockchain purpose-built to support things like NFT collectibles and large-scale crypto games.
CryptoKitties will soon migrate to Flow, and with the surging success of Dapper’s NBA Top Shot, and many other developers signing on to build with Flow amidst the NFT boom, it could prove to be one of the leading blockchains for such creations.
Here’s a look at what Flow is, how it works, and how to get ahold of the FLOW token.
Flow is a blockchain that is designed for extensive scaling without the use of sharding techniques, providing fast and low-cost transactions that make sense for dapps such as NFT marketplaces and crypto-infused video games.
As mentioned, Flow hails from Dapper Labs, which decided to solve its blockchain congestion problem head-on by building one primed for games and other interactive experiences. Dapper is now using Flow for all of its own projects, including NBA Top Shot, but it’s open to other developers as well.
Flow uses a proof of stake consensus mechanism that requires validators to stake a certain number of FLOW tokens to participate in the network.
However, the way that validation works is unique amongst blockchains, as Flow splits validation tasks into four separate types of nodes: consensus, verification, execution, and collection. All four node types participate in the validation of each transaction.
Dapper says that splitting up the tasks makes processing transactions more efficient than on rival blockchains. It’s an alternative option to sharding, or spreading out the storage and computational needs of a blockchain across numerous nodes. Flow does not use sharding, and by doing so, Dapper says that Flow keeps transactions atomic, consistent, isolated, and durable (ACID), and allows developers to build on each others’ work.
Flow also features upgradeable smart contracts, allowing smart contracts to be deployed in beta and then enhanced or fixed before being finalized and made immutable.
Flow is built for the kind of collectible and interactive crypto experiences that are quickly growing in prominence, and could find much larger audiences in the years to come. NBA Top Shot has already demonstrated the potential for a blockchain-driven collectibles experience to generate huge sums of cash and find major mainstream attention. That’s just one experience built on top of Flow, with many more to come.
NBA Top Shot has already been an enormous success, but Dapper Labs has other high-profile partners in its stable, including the likes of Ultimate Fighting Championship (UFC), CNN and Dr. Suess. Besides those brands, Dapper also has partners like gadget giant Samsung, game publisher Ubisoft, and Warner Music Group.
Right now, as a user, you can interact with Flow via NBA Top Shot or by buying artwork from the VIV3 NFT marketplace, as well as other working apps built on the blockchain. Developers can begin using the various built-in tools to experiment with Flow and start building their own dapps.
Flow’s native FLOW token was initially offered to the public in October 2020 through CoinList, but was unavailable within the United States and Canada. Tokens sold through the offering were locked up for at least a year thereafter, which means they can’t be circulated until they're unlocked.
On the other hand, FLOW rewards paid to validators can be transferred and sold, so there is some FLOW out on the market, and some exchanges—like Kraken and Huobi—let users transact FLOW. However, major exchanges like Binance and Coinbase do not currently handle FLOW.
NFT collectibles blew up in a big way in late 2020 and early 2021, and Flow has been one of the biggest beneficiaries of that surge. Not only has Dapper Labs’ own NBA Top Shot been one of the most successful crypto dapps, but Flow reported a significant uptick in developer requests during the early weeks of 2021. In short, NBA Top Shot has been a successful proof of concept for Dapper’s custom-built blockchain, and now other developers want to tap into that infrastructure.
With developer interest comes commercial interest, too; in June 2021, NFT marketplace Rarible, which has to date focused on Ethereum-based NFTs, announced that it would expand its offering to Flow with the proceeds of its $14.2 million Series A fundraising round. Dapper has its own additional collectibles platforms in the works, as well.
Flow's also building out its infrastructure. In June 2021, Dapper Labs launched FUSD, which it described as the first U.S. dollar-backed stablecoin on Flow; the stablecoin is backed one-for-one by U.S. dollars deposited at financial infrastructure provider Prime Trust.
That's part of Dapper Labs' wider ambitions for Flow, which envisage it being used for more elaborate game experiences beyond NFTs: Dapper calls it the “blockchain for open worlds.” On one hand, “open” implies decentralization—but it may only be a matter of time before it plays host to large-scale crypto games, as well.
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